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Emerging Trend: Mini-Programs & What It Means for Global Brands

May 28, 2021

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By: Anthea Zhang, Managing Director Monstarlab China  

 

Merging online with offline starts with a good eCommerce platform as a solid foundation. Mini-programs are emerging as a quick, reliable, low-risk and profitable gateway for brands to bridge the digital and physical shopping divide.       

Part of our Wholesale, Retail, & eCommerce Series

Evolving From Online-to-Offline to Online-Merged-with-Offline

In the past few years, and even in the wake of the pandemic, China has continued to drive digital innovation across industries. The effects are particularly apparent in the retail sector, setting record numbers in eCommerce adoption and quick accustomisation to the digital lifestyle.    

This fast-growing market was one of the first to take the Online to Offline (O2O) framework mainstream through consumer technologies that transitioned customer experiences from digital to physical. However, one limitation of this approach is that it essentially considers online and offline as separate markets that must be bridged by technology.       

Being the trailblazers they are, a new and more integrated framework is now starting to sweep across China. From the O2O model, now comes OMO, which means Online-Merged with-Offline. Compared to the former, OMO does not treat digital and in-person shopping as distinct experiences. Instead, this model aims to merge them into one complete and holistic customer experience.       

In essence, OMO takes the best qualities of eCommerce and physical experiences to provide a wide variety of shopping possibilities. To paint a clearer picture, let’s have an example. 

Grocery shopping is one of the top shopping behaviors that have largely migrated to digital. Consumers love the convenience of purchasing online and have the items delivered to their homes. However, there are particular items they would prefer to see, touch, or even taste before choosing, which of course digital cannot provide. Physical shopping can accommodate that quirk but it comes with the inconvenience of physically picking up the items, lining up to pay at the counter, and taking the items home. 

With the OMO framework, customers are given the option to shop online even while in-store. Shoppers can scan preferred items they want to buy in the grocery store, check out and pay online on their mobile phones, and then have it delivered to their homes. They get the best of both worlds with just a few taps on a screen.

Aside from providing a cohesive end-to-end shopping experience, OMO also allows brands to create extensive customer profiles. Having access to multiple touch points spanning foot traffic, eCommerce apps, mobile payment systems, websites, and social messaging apps such as WeChat, empowers brands to optimize their product offerings and highly personalise the overall shopping experience.

Mini-Program is a Key to Driving OMO   

One of the foundations in implementing OMO is having a reliable and accessible eCommerce platform. The global digital marketplace has been saturated by the spike in online retailing shops in the last couple of years due to the digital shift. Brands are facing challenges when it comes to identifying and setting up the most suitable digital platform, vying for customer attention and share of wallet. You can read more about these challenges here.

Going back, brands have typically opted to have their mobile/digital app developed or even join large digital marketplaces. Each comes with its own set of hurdles for success but at the top of the list lies gaining traction and customer usage. Competition is tighter than ever and customers are not keen on downloading yet another app just for one brand.     

It is therefore no surprise that mini-programs have steadily emerged as a viable platform for brands looking to engage a wider audience more efficiently. Tencent’s WeChat Mini-Program has been a huge hit as soon as it launched in 2017. Known as the “app inside an app”, mini-programs make engaging customers easier for brands in the retail industry.

Today, WeChat is the most popular mobile social media platform in China and the number of Monthly Active Users (MAU) only keeps growing. As of June 2020, there were 1.20 billion WeChat MAU while 60% of them actively use a mini-program.

Data Source: huaon, daxue consulting analysis, Evolution WeChat MAU

A massive number of users engage with the app on a daily basis reaching 902 million daily active users at the end of 2020 [1]. More and more brands are looking at WeChat mini-programs to drive their OMO business strategy, for which reason the platform saw an increase in brand mini-programs to more than 1 million as of early this year.  

Brands’ benefits from the mini-programs include no charge fees, low cost & fast development, and rich, inherent traffic as consumers can access the brand’s unique mini-program without ever having to leave WeChat or download a separate app. 

Mini-programs are poised to be a key part in merging online and offline service experiences. “Offline stores + mini-programs” has become a new way of consumer life. 

How Brands Can Leverage WeChat Mini-Program 

Technology-Enhanced Product Showcase 

Mini-programs can help brands to better showcase their products through Live Stream, by using 3D models, VR movies, and AR filters which greatly enhance the consumer experience and help increase sales. Mini-program LiveStream is fast gaining popularity as it provides shoppers a live visual presentation of the products and they can purchase during the streaming itself.  

Improved Profitability  

In China, many companies and stores in the retailing industry rely primarily on traditional eCommerce platforms when selling online. However, orders fulfilled on such platforms generally charge a “usage fee” ranging from 8% to 20% of the sale. 

Mini-programs do not charge usage fees, therefore businesses get to keep 100% of the revenues generated on the platform.

Customer Engagement Through Native Features

Message notifications on websites, web applications, and mobile apps generally use SMS and mobile push notifications. Mini-programs, on the other hand, remind users of payment, orders, delivery, and much more through the notification service provided by WeChat. This not only saves costs, but also gets the users’ attention more effectively as they are already within the platform. 

WeChat notification service for Pinduoduo, JD.com (image source: WeChat)

Another great benefit of using WeChat mini-programs, is the customer engagement functionality “share”, which provides a better brand visibility as compared to communications shared via other apps. 

Comparison of mini-program and app sharing (image source: Pinduoduo)

Gain Customer Insights via Analytics

WeChat mini-programs provide data monitoring tools similar to Google Analytics, with which brands can easily track and analyse their users’ purchase journey. This gives valuable insights on what products, brand communications, and features resonate with the shoppers.  

Mini-program Data Assistant (Image source: WeChat public platform)

Conclusion

OMO is said to be one of the most popular strategies in China, where a popular saying goes “you can live with one smartphone”. The infusion of digital into Chinese lives has made online and offline more and more integrated, resulting in major companies having developed their own WeChat mini-programs, at great benefits to both consumers and companies. 

The beauty of mini-programs is that they combine social media and commerce into one smooth consumer journey. It’s not a surprise that a large majority of retail brands have developed their own mini-program. Leveraging on this to drive OMO strategy does not only indicate an understanding of changing consumer demands and behaviour, but also demonstrates the willingness to provide accessible solutions to address them.

Meet our Expert:

Anthea Zhang, Managing Director of Monstarlab China, is the global lead for market localization & integration. Having worked with large enterprises to successfully penetrate the Chinese market through innovative digital solutions such as mobile app and mini-program development.

 

Monstarlab China Mini Program Solution

As one of the leading digital products development partners for brands in China, we are experienced in WeChat platform development and can help your brand develop a mini-program with the most relevant and exciting functionalities.

Click here to learn more about our Mini Program Solution

 

Read more insights and see some of our works on Wholesale, Retail, & eCommerce

Notes:

[1]: Review42.com, 21 Mind-Blowing WeChat Statistics in 2021, 2021